Item 4.01. Changes in Registrant’s Certifying Accountant.
On September 19, 2016, Nova LifeStyle, Inc. (the "Company") was advised that the Company's independent registered public accounting firm, Crowe Horwath (HK) CPA Limited, decided to terminate its audit and assurances services to public companies subject to the statutes and regulations of the United States, effective as of October 1, 2016. According, the Company, with the approval of its audit committee, terminated the services of Crowe Horwath (HK) CPA Limited (“CHHK”), effective September 22, 2016, and retained the services of DCAW (CPA) Limited (“DCAW”), effective September 22, 2016.
The director formerly responsible for the Company's account at Crowe Horwath (HK) CPA Limited will join the Company's new audit firm, DCAW (CPA) Limited, and will be the director responsible for the Company's account at DCAW.
CHHK’s report on the financial statements of the Company for the fiscal year ended December 31, 2015 did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles. During the Company’s fiscal year ended December 31, 2015 and through September 22, 2016, there were no disagreements (as that term is defined in Item 304(a)(1)(iv) of Regulation S-K) between CHHK and the Company on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure which disagreements, if not resolved to CHHK’s satisfaction, would have caused CHHK to make reference to the subject matter in their report on the Company’s consolidated financial statements for such periods. Furthermore, no “reportable events” occurred within the periods covered by CHHK’s reports on the Company's consolidated financial statements, or subsequently up to the date of CHHK’s dismissal. As used herein, the term “reportable event” means any of the items listed in paragraphs (a)(1)(v)(A)-(D) of Item 304 of Regulation S-K.
The Company has provided CHHK with a copy of the foregoing disclosures and has requested that CHHK review such disclosures and provide a letter addressed to the Securities and Exchange Commission (“SEC”) stating whether they agree with the statements made therein. Attached as Exhibit 16.1 is a copy of CHHK’s letter addressed to the SEC relating to the statements made by the Company in this report on Form 8-K.
During the Company’s two most recent fiscal years ended December 31, 2015 and 2014 and through September 22, 2016, neither the Company nor anyone on its behalf consulted DCAW regarding (i) the application of accounting principles to a specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the consolidated financial statements of the Company; or (ii) any matter that was either the subject of a disagreement or a reportable event as described above; and there was neither a written report nor oral advice was provided to the Company by DCAW concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue.